Do Infrastructure Reforms Reduce the Effect of Corruption? : Theory and Evidence from Latin America and the Caribbean

This paper investigates the interaction between corruption and governance at the sector level. A simple model illustrates how both an increase in regulatory autonomy and privatization may influence the effect of corruption. The interaction is analyzed empirically using a fixed-effects estimator on a...

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Main Author:	Wren-Lewis, Liam
Format:	Journal Article
Language:	en_US
Published:	Oxford University Press on behalf of the World Bank 2017
Subjects:	corruption governance infrastructure electricity labor productivity regulation privatization regulatory autonomy
Online Access:	http://hdl.handle.net/10986/25845

id	okr-10986-25845
recordtype	oai_dc
spelling	okr-10986-258452021-04-23T14:04:32Z Do Infrastructure Reforms Reduce the Effect of Corruption? : Theory and Evidence from Latin America and the Caribbean Wren-Lewis, Liam corruption governance infrastructure electricity labor productivity regulation privatization regulatory autonomy This paper investigates the interaction between corruption and governance at the sector level. A simple model illustrates how both an increase in regulatory autonomy and privatization may influence the effect of corruption. The interaction is analyzed empirically using a fixed-effects estimator on a panel of 153 electricity distribution firms across 18 countries in Latin America and the Caribbean from 1995–2007. Greater corruption is associated with lower firm labor productivity, but this association is reduced when an independent regulatory agency is present. These results survive a range of robustness checks, including instrumenting for regulatory governance, controlling for a large range of observables, and using several different corruption measures. The association between corruption and productivity also appears weaker for privately owned firms compared to publicly owned firms, though this result is somewhat less robust. 2017-01-11T22:37:12Z 2017-01-11T22:37:12Z 2015-07 Journal Article World Bank Economic Review 1564-698X http://hdl.handle.net/10986/25845 en_US CC BY-NC-ND 3.0 IGO http://creativecommons.org/licenses/by-nc-nd/3.0/igo World Bank Oxford University Press on behalf of the World Bank Publications & Research :: Journal Article Publications & Research Latin America & Caribbean Caribbean Latin America
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	en_US
topic	corruption governance infrastructure electricity labor productivity regulation privatization regulatory autonomy
spellingShingle	corruption governance infrastructure electricity labor productivity regulation privatization regulatory autonomy Wren-Lewis, Liam Do Infrastructure Reforms Reduce the Effect of Corruption? : Theory and Evidence from Latin America and the Caribbean
geographic_facet	Latin America & Caribbean Caribbean Latin America
description	This paper investigates the interaction between corruption and governance at the sector level. A simple model illustrates how both an increase in regulatory autonomy and privatization may influence the effect of corruption. The interaction is analyzed empirically using a fixed-effects estimator on a panel of 153 electricity distribution firms across 18 countries in Latin America and the Caribbean from 1995–2007. Greater corruption is associated with lower firm labor productivity, but this association is reduced when an independent regulatory agency is present. These results survive a range of robustness checks, including instrumenting for regulatory governance, controlling for a large range of observables, and using several different corruption measures. The association between corruption and productivity also appears weaker for privately owned firms compared to publicly owned firms, though this result is somewhat less robust.
format	Journal Article
author	Wren-Lewis, Liam
author_facet	Wren-Lewis, Liam
author_sort	Wren-Lewis, Liam
title	Do Infrastructure Reforms Reduce the Effect of Corruption? : Theory and Evidence from Latin America and the Caribbean
title_short	Do Infrastructure Reforms Reduce the Effect of Corruption? : Theory and Evidence from Latin America and the Caribbean
title_full	Do Infrastructure Reforms Reduce the Effect of Corruption? : Theory and Evidence from Latin America and the Caribbean
title_fullStr	Do Infrastructure Reforms Reduce the Effect of Corruption? : Theory and Evidence from Latin America and the Caribbean
title_full_unstemmed	Do Infrastructure Reforms Reduce the Effect of Corruption? : Theory and Evidence from Latin America and the Caribbean
title_sort	do infrastructure reforms reduce the effect of corruption? : theory and evidence from latin america and the caribbean
publisher	Oxford University Press on behalf of the World Bank
publishDate	2017
url	http://hdl.handle.net/10986/25845
_version_	1764460296120827904

Do Infrastructure Reforms Reduce the Effect of Corruption? : Theory and Evidence from Latin America and the Caribbean

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